Today’s Secret Word is “Antitrust”

One of the big moves in left economics in recent years is the revival of demands for antitrust enforcement. I haven’t written about this much for the simple reason that I don’t know very much about the details and I haven’t had time to really learn that much. But as Lord Manchin refuses to allow any legislation to pass the Senate and Republicans look to take congressional power for the foreseeable eternity beginning in a year, it’s increasingly clear the Biden administration is going to turn to antitrust enforcement as one of the tools it can use within the executive branch to push forward a fairer America. This good piece on what has happened in the beef industry is a great example of why it is necessary.

Judging from the prices at supermarkets and restaurants, this would appear to be a lucrative moment for cattle ranchers like Steve Charter.

America is consuming more beef than ever, while prices have climbed by one-fifth over the past year — a primary driver for the growing alarm over inflation.

But somewhere between American dinner plates and his 8,000-acre ranch on the high plains of Montana, Mr. Charter’s share of the $66 billion beef cattle industry has gone missing.

….

The distress of American cattle ranchers represents the underside of the staggering winnings harvested by the conglomerates that dominate the meatpacking industry — Tyson Foods and Cargill, plus a pair of companies controlled by Brazilian corporate owners, National Beef Packing Company and JBS.

Since the 1980s, the four largest meatpackers have used a wave of mergers to increase their share of the market from 36 percent to 85 percent, according to the U.S. Department of Agriculture.

Their dominance has allowed them to extinguish competition and dictate prices, exploiting how federal authorities have weakened the enforcement of laws enacted a century ago to tame the excesses of the Robber Barons, say antitrust experts and advocates for the ranchers.

One landmark piece of legislation, the Packers & Stockyards Act of 1921, was adopted by Congress to “safeguard farmers and ranchers” — among other market participants — from “unjustly discriminatory and monopolistic practices.”

Today’s record high beef prices are most directly reflective of scarce stocks, another manifestation of the Great Supply Chain Disruption accompanying the pandemic. The initial spread of the coronavirus swept through slaughterhouses, killing scores of workers, sickening thousands and halting production. That caused shortages of beef.

But the shock landed atop decades of takeovers that closed slaughterhouses. The basic laws of economics suggest what happens when the packers cut their capacity to process beef: The supply is reduced, increasing consumer prices. At the same time, fewer slaughterhouses limits the demand for live cattle, lowering prices paid to ranchers for their animals — an advantage for the packers.

“Their goal is to control the market so that they can control the price,” said Marion Nestle, a professor of food studies and public health at New York University. “The pandemic exposed the consequences of the consolidation of the meat industry.”

Of course these ranchers will vote for politicians who won’t do a damn thing about the monopolization of the beef industry, but let’s leave that aside for a minute. Even if they did vote for Democrats in rural Montana, it wouldn’t really matter for the question at hand. They don’t have that much political power. It is necessary for the federal government to take action here and antitrust enforcement is a critical tool.

This naturally infuriates Larry “Obama’s Buddy and Lover of Dumping Toxic Waste in Africa” Summers:

However, as described, hipster Brandeisian antitrust, with which the Admin and its appointees flirt, is more likely to raise than lower prices.

— Lawrence H. Summers (@LHSummers) December 26, 2021

The noted hipster Louis Brandeis! What an asshole. Hopefully Biden tells Summers to drown himself in a vat of that toxic waste before it reaches Africa.